5 Minutes Scalping System
In this article I am going to talk about setting a time frame for scalping Forex. The scalping Forex method has been used for decades, it’s simple and effective, but it does have it’s drawbacks. For example it requires quite some amount of capital to start with and you don’t always know when you are going to strike it rich, so it’s not a sure thing. So we need to set a time frame for scalping and make sure that our expectations are realistic.
So lets discuss how we can set a time frame to 5 minutes scalping system, firstly we need to understand what exactly scalping is. Scalping is essentially shorting and trading the same currency against another currency. By doing this you are essentially betting that the currency value will fall in price. There are two major types of scalping, bull scalping and bear scalping.
Bull Scalping is where the goal is to make a profit quickly, if done well in the first few minutes. If the first few minutes pass by without a single purchase you should return to your system’s terminal. The key here is to know how much the market will go down and up before proceeding to trade. Bear scalping on the other hand is when you use an oversold or overbought system and wait for the prices to drop before buying again, you set a time frame and once the prices reach the low you sell, that’s all there is to it.
Setting Time Frame For 5 Minutes Scalping System
So how do we know what time frame to follow? Simple, you need to have an accurate Fibonacci calculator. With this tool you can figure out very easily, the time it takes for any currency pair to reach the target price and time you expect it to return to that same price. So lets say you have a Fibonacci calculator and you start following a trend, you enter the time frame and it will give you a chart with the estimated time frame. You can see at the top of the chart the exponential function that runs down the left axis, and it represents the amount of price change in a certain time frame.
For instance, if you wanted to place a trade at 4 PM and the market is going to go down at 4 PM you know the Fibonacci formula will give you an approximate price decrease of $0.40. Now you know to watch the charts and you know the direction of the market. You know it is best to enter a trade using this time frame and once it hit the low you exit so it goes back up. So basically you are using this system as your guide. It tells you exactly when to enter and exit your trade.
So to summarize here is what the scalping method is all about. It is a great tool for novice and experienced traders to use. If you have never been successful trading, you might want to learn more about the time frame trades. It is not for the expert trader that wants to win all the time. It is a great system that any trader can use to make money in today’s market. Just remember it is not set up for perfection but to do well with average results.